Rupee slips 9 paise to 71.42 against US dollar in early trade

The rupee opened on a weak note and declined by 9 paise to 71.42 against the US dollar in opening trade on Thursday, after weak macro-economic data disappointed market participants.

Forex traders said disappointing macro economic numbers weighed on the local unit.

Government data on Wednesday showed that industrial output contracted by 0.3 per cent in December, while retail inflation jumped to a 68-month high of 7.59 per cent in January on high food prices.

The rupee opened weak at 71.35 at the interbank forex market and then fell further to 71.42, down 9 paise over its last close.

The rupee had settled at 71.33 against the US dollar on Wednesday.

Market participants further said that factors like weak opening in domestic equities and rising crude oil prices weighed on the local unit, while weakening of the American currency supported the local unit to some extent.

Brent crude futures, the global oil benchmark, rose 0.14 per cent to USD 55.87 per barrel.

Foreign institutional investors (FIIs) remained net buyers in the capital markets, as they purchased shares worth Rs 48.81 crore on Wednesday as per provisional data.

Domestic bourses opened on a cautious note Thursday with benchmark indices Sensex trading 144.79 points down at 41,421.19 and Nifty down 32.40 points at 12,168.80.

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.04 per cent to 99.01.

The 10-year government bond yield was at 6.46 per cent in morning trade.